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GRACosway Political Week in Review
3 June 2016
Federal Election Campaign Diary
The second Leader’s debate of the election campaign was held on Sunday, marking the beginning of a week dominated by discussion about tax and superannuation. The debate was widely described as lacklustre and without a clear winner, with issues such as economic management, border protection and environmental policy front and centre.
With tax back on the agenda this week, Labor confirmed it will keep the temporary budget repair levy in place for those earning over $180,000 if elected on July 2. Prime Minister Turnbull labelled the Opposition’s move as unfair, arguing that retaining the levy would stifle growth and result in less revenue for health and education measures. Labor returned fire on the Government, saying it is not the right time to reduce company tax.
While the Government spent much of week four of the election campaign continuing to spruik its jobs and growth agenda, reports of a possible electoral backlash against the Coalition’s superannuation reforms emerged, with West Australian Liberal MP Ian Goodenough conceding he had received feedback from many voters opposed to the measures. Further reports suggested Liberal Party members are particularly concerned about the changes, with some refusing to donate to the Coalition’s election campaign as a result. Treasurer Scott Morrison and Cabinet Secretary Arthur Sinodinos backed the Prime Minister's commitment to keep the reforms as announced in the Budget.
The Australian Bureau of Statistics released the National Accounts mid-week, which were better than expected; 1.1 per cent growth in the first quarter of 2016 and 3.1 per cent growth over the past year. In responding to the figures, the Prime Minister said growth in exports was a result of the Government’s focus on trade agreements, while also pointing out that continued growth requires strong economic leadership and warned against complacency in the face of significant challenges. 
Following the emotional resignation of Nova Peris from the Senate last week, Labor announced that former Member of the Northern Territory Legislative Assembly Malarndirri McCarthy will replace her at the top of Labor’s NT Senate ticket. In her first media appearance since the announcement, Ms McCarthy confirmed she is not currently a member of the ALP nor is she enrolled to vote in the Northern Territory – changes to electoral enrolments closed last week.
Meanwhile, discontent within the Coalition camp over the order of candidates on the NSW Senate ticket was resolved this week when Liberal Minister Concetta Fierravanti-Wells was bumped up to the number four position on the ticket. Still in NSW, former Australian Idol host and television personality James Mathison announced he will run as an independent against former Prime Minister Tony Abbott in the safe Sydney seat of Warringah, focusing his campaign on environmental and social justice issues.
Senator Nick Xenophon and his party continue to receive strong support, with new analysis of recent Newspoll figures showing more than 1 in 5 South Australians plan to vote for the Nick Xenophon Team (NXT). The traditionally safe Liberal seat of Mayo in South Australia is shaping up as a potential battleground, with recent polling showing NXT candidate Rebekha Sharkie is likely to pose a challenge for incumbent MP Jamie Briggs. Prime Minister Turnbull is in the Adelaide Hills area of Mayo today and joined Mr Briggs to announce $3.75 million for a new sporting complex in the electorate. Meanwhile, Senator Xenophon has conceded he failed to declare his directorship of Adelaide Tower Pty Ltd – a company run by his father which once had $2.5 million in unpaid company taxes – on his parliamentary register of interests. Senator Xenophon has promised to correct the omission immediately, calling it an “embarrassing oversight”.
In a break from recent tradition, Labor’s official election campaign launch will be held in Western Sydney on June 19, in the marginal Liberal-held seat of Lindsay. Media reports indicate the Coalition may also decide to launch in Sydney instead of Brisbane, which has been the chosen location for both major parties’ campaign launch events since 2004. Prime Minister Turnbull continues to prioritise campaigning in marginal Liberal-held electorates, having visited twice as many marginal government seats as Bill Shorten in the first three weeks of the campaign.
With now fewer than 30 days to go, the punters are still favouring the Coalition, with CrownBet offering $1.30 for a Coalition win and $3.45 if Labor prevail. 
Highlights of the Week
  • Prime Minister Malcolm Turnbull joined Liberal MP Fiona Scott in her marginal electorate of Lindsay to announce $4.6 million for 12 new pilot sites in the Pathways in Technology Early College High School program.
  • Labor pledged $21 million for the ABC to broadcast more women's sports, which it says will increase coverage by around 500 hours over four years.
  • The Coalition committed $20 million to establish a research collaboration for high risk childhood cancers under the Zero Childhood Cancer Initiative.
  • Labor announced its renewable energy and Great Barrier Reef policies.
  • Mr Shorten confirmed that Labor will honour the Commonwealth's funding commitment to the WestConnex project, if elected.
  • The Coalition released its policy to establish a $40 million Safer Communities Fund for crime prevention initiatives, such as CCTV and lighting.  
  • The Coalition announced $3.75 million funding for the Mount Barker Regional Sports Hub in the electorate of Mayo.
  • Opposition Leader Bill Shorten refused to respond to questions about Labor’s position on possible changes to penalty rates this week by claiming the Fair Work Commission would not recommend cutting penalty rates because “the evidence doesn’t support it”.
  • The Greens announced a $1 billion plan to build 1000 kilometres of bike and walking tracks in Australian cities.  
  • The Fair Work Commission has increased the minimum wage by 2.4 per cent to around $672.70 per week.
Policy in Focus – Tax

Malcolm Turnbull came to the prime ministership in September 2015 promising economic leadership and proper debate on the complex issues facing Australia. Continuing a “national conversation” on tax reform initiated by his predecessor, Mr Turnbull wasted no time in bringing it to the forefront of the public debate, emphasising that all options for tax reform were on the table. An increase to the GST was floated – and later ruled out by the Government because it did not pass the “first test” of delivering economic growth. A bold proposal to allow states to levy income tax followed but was rejected by state and territory leaders.
Tax reform featured prominently in the lead in to the election campaign. The Coalition has put its Tax White Paper process on hold and, through the May Budget, shifted its focus toward addressing corporate tax avoidance, a staged reduction in company tax and delivering modest income tax benefits. Meanwhile, Labor has committed to tightening negative gearing and the capital gains tax discount, and labelled the Government’s proposed company tax cuts as a “giveaway to the big end of town” at the expense of average Australians.
In the Budget, the Coalition announced the Ten Year Enterprise Tax Plan to reduce the company tax rate to 25 per cent over 10 years. From 2016-17, the tax rate for businesses with $10 million or less in annual turnover will be 27.5 per cent. The annual turnover threshold will be increased over 10 years to ultimately have all companies at 27.5 per cent by 2023-24. Labor argues that now is not the time for such significant tax breaks and confirmed this week that businesses with turnover of between $2 million and $10 million will not receive a tax cut or the $20,000 instant asset write-off under a Shorten Labor Government. In response, the Government accused the Opposition of waging a war on business and “using tax as their bullets”.
This week, Mr Shorten also announced that the 2 per cent deficit levy on those earning more than $180,000 will continue for a decade under a Labor Government; the temporary deficit levy – with bipartisan support – was originally legislated to end on 1 July 2017. The Coalition has previously pledged not to renew the deficit levy beyond its expiration, saying it would act as a handbrake on growth and deliver less revenue for health and education measures.
Following passage of the Tax Laws Amendment (Combating Multinational Tax Avoidance) Bill 2015 in December 2015, the Coalition introduced a 40 per cent diverted profits tax to address multinational tax avoidance. The measures were passed with the support of the Greens in the Senate after Labor refused to back the legislation because it did not go far enough in combating multinational tax avoidance. In response, Labor has since released Their Fair Share, a seven-part policy to address multinational tax avoidance, which includes plans to standardise Australia’s tax law with other countries to prevent “double-dipping”, and improved resources for the Australian Tax Office to boost compliance.

Policy Wrap Up

The NSW Government’s council amalgamation plan has suffered a setback after the Government conceded there were errors in the report on the proposed merger of Strathfield, Burwood and Canada Bay Council, following an appeal made by Strathfield Council to the Land and Environment Court. The Government has been forced to put a hold on plans for this merger until a corrected report is issued, however, Premier Mike Baird told the NSW Parliament that the Government remains committed to the mergers. Read coverage by The Australian here.
A significant overhaul of Queensland’s electoral boundaries is underway, which is due to be finalised by April 2017. The newly appointed Queensland Redistribution Commission has been charged with redistributing the State into 93 districts, which includes creating four new electorates that are all likely to be located in southeast Queensland. The Opposition has accused the Palaszczuk Government of delaying the redistribution process in order to hold an early election with the existing boundaries. See coverage by the Courier Mail here.
The Victorian, South Australian and ACT parliaments sit next week, while Budget Estimates will take place in Tasmania. 


State Developments

The NSW Government has launched a trial to turn food waste into renewable energy. The three year trial is jointly funded by Sydney Water and the Office of Environment and Heritage’s Sustainability Advantage program, and will see food waste create 60 per cent of the energy used at the Cronulla Wastewater Treatment Plant.  See media release: Cronulla Treatment Plant turning your fruit and vegie waste into electricity.
The Queensland Government has expanded its commitment to large-scale solar generation. It will increase its long-term financial support to 120 megawatts (MW) of installed large-scale solar production, up from the previous commitment of 60MW in August 2015. Queensland projects that secure funding from the Australian Renewable Energy Agency will then be eligible for State Government funding. See media release:  Queensland triples solar ambition for clean energy future.


Federal Developments

Dr Michael Gannon has been elected as the new President of the Australian Medical Association (AMA) to replace Professor Brian Owler. Dr Gannon is an obstetrician and gynaecologist based in Western Australia, and comes to the role with a commitment to improve the AMA’s relationship with the Federal Government, which he says has been strained because of issues relating to asylum seekers. General Practitioner and outgoing President of the AMA’s Victorian branch Dr Tony Bartone has been elected as the body’s Federal Vice President. See media release: Dr Michael Gannon elected new AMA President

State Developments

Victorian Minister for Housing, Disability and Ageing Martin Foley has announced a new $55.57 million, 90-bed public aged care facility will be built at St George’s Hospital in Kew. The new facility is part of the Andrews Government’s strategy to upgrade Victoria’s public aged care system. The consultation and planning process for the service is now underway. See media release: Labor’s new vision to modernise public aged care  

About GRACosway
GRACosway is Australia's leading public affairs and corporate and financial communications counsel, and has been assisting organisations understand and navigate elections at federal and state levels for over 20 years. The firm provides a full suite of integrated services to a range of domestic and international clients across all industry sectors, including public policy, communications, regulatory, issues management and media relations advice. From offices in Sydney, Melbourne, Brisbane, Adelaide, Canberra and Perth (GRA Everingham), GRACosway’s clients benefit from the combined experience, expertise and strategic perspective of our team of professionals in addressing complex and commercially sensitive projects. For more information, visit
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